Federal and Local Funding Incentives for Multifamily Energy Efficiency Upgrades

Photo by ljcybergal

The federal government recently recognized that the U.S. rental housing sector needs an impetus for large scale energy efficiency. The Department of Housing and Urban Development (HUD) has announced the availability of $25 million in grants from a Multifamily Energy Efficiency Pilot program. The intention for the program is to stimulate innovative approaches for increasing the efficiency of existing multifamily residential properties that can be replicated by others.

HUD expects the following outcomes:

1. Lower energy consumption from multifamily properties leading to lower costs and less pollution.
2. Increased private investment in energy efficiency
3. Green job creation and cultivation of green knowledge by owners and managers. 
4. Opportunity for solutions for split incentives between owner paid v. tenant paid utilities.

Unfortunately, rather than offering the funding to a majority of the rental housing market the feds opted for the trickle down theory. Up to $7.5 million can be awarded to one applicant.
Eligibility for the grants are limited to organizations with a minimum portfolio of 1,000 affordable housing units. Development financing entities that have affordable housing programs are also eligible.

Translation: A few organizations will get all the funding and hopefully reveal the strengths and weaknesses of federal energy efficiency incentives suited for multifamily properties.

Photo by fusionpanda

Thankfully, there is a California program with much clearer incentives available to a much wider base of multifamily owners. The Energy Upgrade California program offers one of the more promising multifamily energy efficiency incentives for buildings located in San Francisco, Los Angeles or Alameda County. Rebates and incentives range from $6,500 - $110,000 and are available to multifamily buildings with 5+ units. Accepted participants receive a free consultation to identify upgrading goals and opportunities. An initial incentive is then provided to help offset the upfront cost of performing an energy audit. If the units are deemed eligible after the audit an additional incentive is available to improve the building performance. The energy upgrade incentive in Los Angeles is capped at $100,000 or 60% of the net construction costs. There are also additional incentives to achieve the GreenPoint Rated Multifamily Existing Home or LEED label.

These local programs are some of the best we’ve seen for multifamily energy efficiency upgrades. They have been designed to be practical and enticing for owners to improve their properties, lower costs and lessen the impact on the environment. Take advantage.

For more information visit Multifamily Green.